We are going to explore factory identification today.
"Hooray", I hear you all screaming!
Let's jump right in. You want to find the best for your needs NOT the best in the world. This means casting your net wide and whittling down to the best that fit your needs.
You are not just looking at price. You are also looking at factory size, product range they make and the amount of attention you are getting from them.
After understanding this information, you should get quotes and some STOCK samples they may have in the facility to get an idea of quality. But you are not done here. There is much much more to come.
If your item is not customised and is a standard size, chances are you can get the size and dimensions of your product NOW along with the quote.
Why is this important? Let’s kill two bird with one stone (一举两得 )
You will be able to calculate your final cost of the goods WITH shipping. This is a great method to figure out if this product has enough margin for you. I will follow up more with this in a future post.
Here is a follow through of how to get started:
Let’s look into socks.
What type of socks ? - Compression socks and Plantar fasciitis socks
What type of material ? – 70% cotton 30% spandex
I first would jump on Alibaba - Search : - Compression socks
You notice a lot of info on the left. This is a way for you to filter down choices. You will also notice there is 17,504 “products” from your search.
Click on suppliers and focus in. The number now is 856 “ suppliers”
Start opening up some links and get to learning.
This supplier looks good (let save that link and put to the side in a document).
The product line is consistent and they focus in this product.
This supplier is not the best choice; they sell a lot of different stuff. Possibly a trading company and they do not focus only in one industry. Since they are a trading company, it will be a little higher price than working with a factory directly
Sometimes you want a company like this, because it has all the products for niche in one place. You don’t mind to pay a little extra for the convenience. Another benefit would be they provide some kind of customer service and QC services.
Continue your search like this. Open the pages and look at the main products page. Then click on the product that resembles what you are looking for. Take that link and place it in a side document. Some use excel, some prefer word. My team organises everything for me now, so I am lazy.
Boom, simple text file!
Now you got 10 good suppliers you want to contact.
Go to the "contact us" page and find out some emails, I prefer to go the website not Alibaba because I think the response is faster. Sometimes, all they have is an Alibaba site. If that is the case you need to contact them there.
Example of Alibaba contact:
Example of the website contact:
Another fast way besides email is using QQ. In your first email, you can send your QQ number so they can contact you faster. Most suppliers prefer to talk this way. It is a great chat tool BUT not a get place to have all your records. Confirm important details that are agreed to in email, not QQ.
What is QQ?
It is a chat platform that everyone in China uses for desktops. I suggest getting a QQ number. If you don't have it, get it. Search for "QQ international" for the english version
What is Wechat?
For cellphone chat look up Wechat (same company). In the cellphone chat world in China, Wechat is king or should I say emperor? Searching for this on "Play" or " Itune APP" should come up easily.
Send off the email! Wait for 2 days and if for anyone that did not respond, I usually send one more email. Remember to keep it simple. I gave an example like this before.
You should start getting quotes back. I like to organise them in an excel sheet so we can compare easily.
There are a range of prices. Take a look at product description column and bulk quantity. This is when you go back to the supplier and ask WHY?
Why is “skin” 1.50 usd more then “black?”
Why is this cheaper? You will see a sock for 2 usd but you gotta order 3,000 units .
This is the part you need to look at the price and see what is being offered. Ask questions about “why?” You will either get good information or find out there is no good reason (then you can eliminate them).
Factory Evaluation
After you have identified you top 3 suppliers that have fit your core needs:
- Quality
- Quantity
- Price
- Speed
It is time to get more info on the suppliers themselves. You already have a quote at this point but you need to get into more of the nitty gritty of your project now. Out of four above, what are the two that fit your needs absolutely best.
This is where you double down and start getting samples made of your product with those two suppliers. I would first get stock samples of what the factory already produces. This is will give you a good idea of who you want to continue with. When you feel you like you have a good idea of who you plan to continue you with, you then can concentrate your efforts on make a custom sample for yourself.
If your project is big and complicated, starting samples with two suppliers is not really and option. This is why the first two steps of factory Identification & factory evaluation are very important. In the event the one option does not work out, you have a vetted second choice that is familiar with your product from the beginning.
We are going to talk about negotiation in the next post. How to get better pricing,better terms for yourself and how to protect yourself.
Superb post. I like that you mention the importance of QQ and WeChat, both of which are virtually unknown outside China. I'll actually be talking about them in an upcoming post this week.
Jamon's right, gang: QQ and WeChat will make for smoother and quicker business in China. Why? It'll earn you kudos for using the local apps.
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